UK legal body recommends new framework for using crypto as collateral
The UK crypto framework needs to be bespoke for using cryptocurrency as collateral, the Law Commission recommends....
- The UK Law Commission has recommended creating a bespoke crypto framework for using crypto assets as collateral in the nation.
- The proposed framework would go beyond existing UK regulations around collateral arrangements for traditional finance.
- The commission also suggests classifying crypto assets as a new category of property and forming a panel of experts to advise courts on legal issues involving virtual assets.
- The recommendations were made in a report published on 28 June, as part of the first government-commissioned analysis on accommodating crypto assets and NFTs in existing legal frameworks.
- The commission deems existing rules in England and Wales as inadequate and calls for a multi-disciplinary project to formulate a better statutory legal framework.
The article presents the UK Law Commission's recommendations for a bespoke crypto framework positively, highlighting the need for better regulations and legal clarity for crypto assets.